The following article is by
Steve Kangas from the website Liberalism Resurgent

DID REAGAN PROPOSE HIGHER SPENDING?

Supply-siders dispute the claim that Reagan requested more
spending than Congress actually passed. To show that Congress
was actually the Big Spender, they commonly give the following
chart, which shows that Congress outspent Reagan's budget
requests in 7 out of 8 years:

The problem with this chart is that the proposal
numbers are phony. Reagan's proposals were based on such
optimistic forecasts of the economy that they bore little
resemblance to reality.

To understand how the ruse works, a brief review of the budget
process is helpful. A budget passed by Congress is not written
in stone; there are actually many flexible items in it. One
example is unemployment. The budget says, "Pay each
unemployed person XXXX amount in unemployment
compensation." If the unemployment rate rises higher next
year than anticipated, the budget automatically pays these
extra individuals without requiring Congressional action.

Another example of a flexible budget item is interest on the
debt. If interest rates soar or receipts drop more than
expected, then interests costs are going to be greater. These
are paid without Congressional action (unless the debt limit
is reached).

In the president's budget proposals, he must estimate next
year's unemployment rate, interest rates, and several other
economic indicators. We have already seen that in Reagan's
first budget, David Stockman came up with a super-optimistic
forecast that predicted 5 percent economic growth. (The higher
the growth, the less government has to spend on unemployment,
welfare, stimulus packages, etc.) Today, Stockman derisively
refers to his first budget as the "Rosy Scenario."
Although Reagan's remaining budgets were not quite as
far-fetched as the Rosy Scenario, they were indeed much too
optimistic. In fact, the only reason why spending surpassed
the requests in only 7 instead of all 8 years was because one
year -- 1984 -- actually saw a phenomenal spike of 6 percent
growth.

What supply-siders are doing with the above chart, then, is
comparing what was spent in the real world with what Reagan
proposed in 8 Rosy Scenarios. They then blame the difference
on Congressional action -- despite the fact that Congress didn't
act on these increases.

The ruse is akin to a President proposing to spend one dollar
on the budget next year, and blaming Congress for (inevitably)
exceeding this proposal. Even if it turns out that Congress
cuts the real budget, and the economy does better than normal!

As reported on the previous page [Budgets and Deficits], the House Appropriations
Committee conducted a study that compared Reagan's concrete
proposals to what Congress actually passed, not what was spent
afterwards. And it found that Reagan asked for $29.4 billion
more than Congress passed.